BP 2008 Annual Report Download - page 92

BP Annual Report and Accounts 2008
Additional information for shareholders
BP ShareMatch plans
These are matching share plans, under which BP matches employees’
own contributions of shares up to a predetermined limit. The plans are
run in the UK and in more than 70 other countries. The UK plan is run on
a monthly basis with shares being held in trust for five years before they
can be released free of any income tax and national insurance liability.
In other countries, the plan is run on an annual basis, with shares being
held in trust for three years. The plan is operated on a cash basis in
those countries where there are regulatory restrictions preventing
the holding of BP shares. When the employee leaves BP, all shares
must be removed from trust and units under the plan operated on a
cash basis must be encashed.
Once shares have been awarded to an employee under the plan,
the employee may instruct the trustee how to vote their shares.
Local plans
In some countries, BP provides local scheme benefits, the rules and
qualifications for which vary according to local circumstances.
The above share plans are indicated as being equity-settled.
In certain countries, however, it is not possible to award shares to
employees owing to local legislation. In these instances, the award will
be settled in cash, calculated as the cash equivalent of the value to the
employee of an equity-settled plan.
Cash plans
Cash-settled share-based payments/Stock Appreciation Rights (SARs)
These are cash-settled share-based payments available to certain
employees that require the group to pay the intrinsic value of the
cash option/SAR/restricted shares to the employee at the date of
exercise/maturity.
Employee share ownership plans (ESOPs)
ESOPs have been established to acquire BP shares to satisfy any awards
made to participants under the Executive Directors’ Incentive Plan, the
Medium-Term Performance Plan, the Long-Term Performance Plan, the
Deferred Annual Bonus Plan and the BP ShareMatch plans. The ESOPs
have waived their rights to dividends on shares held for future awards
and are funded by the group. Pending vesting, the ESOPs have
independent trustees that have the discretion in relation to the voting of
such shares. Until such time as the company’s own shares held by the
ESOP trusts vest unconditionally in employees, the amount paid for
those shares is deducted in arriving at shareholders’ equity (see Financial
statements – Note 40 on page 166). Assets and liabilities of the ESOPs
are recognized as assets and liabilities of the group.
At 31 December 2008, the ESOPs held 29,051,082 shares (2007
6,448,838 shares and 2006 12,795,887 shares) for potential future
awards, which had a market value of $220 million (2007 $79 million and
2006 $142 million).
Pursuant to the various BP group share option schemes, the
following options for ordinary shares of the company were outstanding at
18 February 2009:
Expiry dates Exercise price
Options outstanding (shares) of options per share
323,378,846 2009-2016 5.7050-11.9210
More details on share options appear in Financial statements – Note 41
on page 168.
Major shareholders and related party
transactions
Register of members holding BP ordinary shares as at
31 December 2008
Number of Percentage of Percentage of
ordinary total ordinary total ordinary
Range of holdings shareholders shareholders share capital
1-200 57,617 18.22 0.01
201-1,000 120,017 37.94 0.31
1,001-10,000 124,970 39.51 1.83
10,001-100,000 11,837 3.74 1.17
100,001-1,000,000 1,089 0.34 1.95
Over 1,000,000a 790 0.25 94.73
Totals 316,320 100.00 100.00
aIncludes JP Morgan Chase Bank holding 27.48% of the total ordinary issued share capital
(excluding shares held in treasury) as the approved depositary for ADSs, a breakdown of which
is shown in the table below.
Register of holders of American depositary shares (ADSs) as at
31 December 2008a
Percentage of
Number of total ADS Percentage of
Range of holdings ADS holders holders total ADSs
1-200 73,569 53.88 0.50
201-1,000 38,781 28.40 2.16
1,001-10,000 22,656 16.59 7.12
10,001-100,000 1,505 1.10 3.04
100,001-1,000,000 23 0.02 0.47
Over 1,000,000b 2 0.01 86.71
Totals 136,536 100.00 100.00
aOne ADS represents six 25 cent ordinary shares.
bOne of the holders of ADSs represents some 818,000 underlying shareholders.
As at 31 December 2008, there were also 1,622 preference
shareholders. Preference shareholders represented 0.44% and ordinary
shareholders represented 99.56% of the total issued nominal share
capital of the company as at that date.
Substantial shareholdings
The disclosure of certain major interests in the share capital of the
company is governed by the Disclosure and Transparency Rules (DTR)
made by the UK Financial Services Authority. Under DTR 5, we have
received notification that Legal and General Group Plc hold 4.34% of the
voting rights of the issued share capital of the company.
Related-party transactions
Transactions between the group and its significant jointly controlled
entities and associates are summarized in Financial statements – Note 26
on page 140 and Financial statements – Note 27 on page 141. In the
ordinary course of its business, the group enters into transactions with
various organizations with which certain of its directors or executive
officers are associated. Except as described in this report, the group did
not have material transactions or transactions of an unusual nature with,
and did not make loans to, related parties in the period commencing
1 January 2008 to 18 February 2009.
Additional information for shareholders
91